Weekly Investor – July 8, 2013
Slow but Steady Wins the Race
Market Summary:
The U.S. equity markets rallied last week and the S&P 500® was up 1.63%. Markets moved higher in the beginning of the week upon news that manufacturing growth was better than expected. The markets closed Thursday in observance of Independence Day and closed higher on Friday due to positive jobs news. June employment reports confirmed that a steady improvement in the labor market is indeed taking place. Increased employment growth expectations should bode well for equities over bonds as it implies the Fed can taper its stimulus policy. Looking ahead, investors hope for continued good news and the slow but steady improvement in the economy.
The S&P 500® was up 1.6% for the week. The top-performing sectors in the S&P 500® Index included Consumer Discretionary (2.4%) and Technology (2.1%), while bottom-performing sectors included Consumer Staples (0.8%) and Utilities (-2.0%). In the fixed-income market, the 10-year Treasury yield was up during the week, ending at 2.7%.
We continue to seek those companies possessing identifiable catalysts, and focusing on those stocks with favorable odds.
Favorable Odds
EMC Corp. (EMC) develops solutions for the information technology industry. It provides and supports infrastructure for storing, protecting, organizing and retrieving vast amounts of data. EMC’s information management operations can be broken into three segments: storage, archiving and security. With acquisitions, EMC continues to fill out its product portfolio in order to go after more market share.
Additionally, with EMC’s core market as storage, the company is well positioned to benefit from the increase in online content from sites such as those specializing in video sharing. Management is aligned to improve market share while ensuring that current business avenues continue to be successful. At Argent, we view EMC as having favorable odds for our clients.
Top 10 Equity Holdings
| . | |
|---|---|
| Google, Inc. | 5.7% |
| Lowes Co. | 4.6% |
| CBS Corp. | 4.5% |
| Gilead Sciences | 4.2% |
| SunTrust Banks | 4.1% |
| Danaher Corp. | 3.9% |
| Forest Laboratories | 3.7% |
| MasterCard, Inc. | 3.5% |
| Procter & Gamble | 3.4% |
| Post Holdings Inc. | 3.3% |
U.S. Equity Indices
| Index | 07/05/13 | Week % Chg | YTD % Chg |
|---|---|---|---|
| DJIA | 15,135.5 | 1.5% | 15.5% |
| NASDAQ | 3,479.4 | 2.2% | 15.2% |
| S&P 500 | 1,631.9 | 1.6% | 14.4% |
| Russell 1000 G | 743.5 | 1.9% | 13.0% |
U.S. Credit Rates
| Index | 07/05/13 | 06/28/13 | 12/31/12 |
|---|---|---|---|
| 3 Month T-Bill | 0.1% | 0.1% | 0.1% |
| 5 Year T-Note | 1.6% | 1.4% | 0.8% |
| 10 Year T-Note | 2.7% | 2.5% | 1.8% |
| 30 Year T-Bond | 3.7% | 3.5% | 3.0% |
| Prime Rate | 3.3% | 3.3% | 3.3% |
This newsletter presents selected recommendations from portfolio managers of Argent Capital Management LLC, a registered investment advisor. Opinions reflect the portfolio manager’s judgment on the date above and are subject to change. A list of stocks recommended by Argent is available upon request. You should not assume that these recommendations are or will be profitable. In the course of it’s business, Argent’s client accounts may be buying and selling these stocks.
